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Illinois Gov. Pat Quinn signed legislation Friday that grants hundreds of millions of dollars in tax breaks and incentives aimed at keeping two large employers in Illinois.
The measure helps Sears Holdings Corp. and CME Group Inc., which operates the Chicago Mercantile Exchange. Both companies have century-long histories in Illinois. Lawmakers approved the business tax breaks earlier this month along with a separate bill that included tax breaks for individuals, including the working poor. Quinn, a Democrat, has not yet signed that bill.
When taken together, the package would cost the state $330 million or more a year.
Sears and CME had threatened to leave the state if they didn't get help. Other states had reportedly approached them about moving.
"You have to defend yourself. If Ohio is offering $400 million to Sears, a company that has thousands of employees in Illinois, we will defend ourselves with a reasonable, adequate, approach," Quinn told reporters earlier this week. "That's what you have to do in 21st Century America to make sure your state and your businesses have support."
The bill renews a credit Sears has been getting for years. It guarantees the company a $15 million break on its taxes over the next decade and extends a property-tax cut.
In CME's case, lawmakers agreed to retool tax calculations for the profitable company by changing how much of its business is subject to state income taxes.
"We applaud the governor for his leadership and recognition of Sears' contributions to our state -- thousands of jobs and hundreds of millions of tax dollars," Sears spokesman Chris Brathwaite said. "We look forward to remaining in Illinois and building on our long and rich history here."
Sears had said earlier it would stay in Illinois if Quinn approved the bill. CME Group Executive Chairman Terry Duffy announced in a statement Friday the company will remain in Illinois, where its roots go back 160 years.
"This necessary adjustment to the Illinois corporate tax laws will put CME Group on more equal footing with other Illinois companies and other global exchanges," Duffy said.
The bill includes incentives for all businesses, restoring deductions for operating losses and increasing the estate tax deduction while extending the tax credit for research and development. Quinn said he has always supported the research and development tax credit.
"Some of our big companies and smaller companies really need that to come up with new products, new services that can have a world market and create new jobs," Quinn said.
The companion measure, which Quinn's office promised action on soon, would hike the earned income tax credit for low-income working families and would increase the standard personal income tax exemption, eventually linking it to inflation.
The bill is SB397.